China Cord Blood Corporation (NYSE: CO) ("CCBC" or the "Company"), China's leading provider of cord blood collection, laboratory testing, hematopoietic stem cell processing and stem cell storage services, today announced its unaudited financial results for the second quarter and first half of fiscal year 2017 ended September 30, 2016.

Second Quarter of Fiscal 2017 Highlights

Revenues for the second quarter of fiscal 2017 increased by 7.4% to RMB184.1 million ($27.6 million) from RMB171.5 million in the prior year period.

New subscribers and accumulated subscriber base were 18,037 and 536,8771, respectively.

Gross profit increased by 8.1% to RMB145.1 million ($21.8 million) from RMB134.2 million in the prior year period.

Gross margin increased to 78.8% from 78.3% in the prior year period.

Operating income increased by 4.3% to RMB54.7 million ($8.2 million) from RMB52.5 million in the prior year period.

Operating income before depreciation and amortization and share-based compensation expenses was RMB82.9 million ($12.4 million), up 4.0% compared to RMB79.7 million in the prior year period.2

Interest expense was RMB29.8 million ($4.5 million) compared to RMB26.3 million in the prior year period.

Net income attributable to the Company's shareholders was RMB16.6 million ($2.5 million) compared to RMB18.7 million in the prior year period.

Net cash provided by operating activities for the second quarter of fiscal 2017 was RMB136.3 million ($20.4 million) compared to RMB168.5 million in the prior year period, after taking into account the interest payment made to the Company's convertible note holder.

First Half of Fiscal 2017 Highlights

Revenues for the first half of fiscal 2017 increased by 6.0% to RMB357.1 million ($53.5 million) from RMB336.8 million in the prior year period.

Gross profit increased by 6.7% to RMB280.6 million ($42.1 million) from RMB263.0 million in the prior year period.

Operating income increased by 5.9% to RMB106.9 million ($16.0 million) compared to RMB100.9 million in the prior year period.

Operating income before depreciation and amortization and share-based compensation expenses increased to RMB162.6 million ($24.4 million) by 5.2% year-over-year from RMB154.5 million in the prior year period.2

Interest expense amounted to RMB58.6 million ($8.8 million), compared to RMB52.2 million in the prior year period.

Net income attributable to the Company's shareholders increased slightly to RMB32.4 million ($4.9 million) from RMB32.3 million in the prior year period.

Net cash provided by operating activities for the first half of fiscal 2017 was RMB267.3 million ($40.1 million) compared to RMB298.6 million in the prior year period, after taking into account the interest payment made to the Company's convertible note holder.

"During the second quarter, new subscriber numbers increased by 7.7% year-over-year to 18,037 as a result of the solid performance in our Guangdong market, the steady growth in our Beijing market and the Zhejiang market due to our strong hospital channels and tailored marketing initiatives," said Ms. Ting Zheng, Chief Executive Officer of China Cord Blood Corporation. "While the macroeconomic environment was slower and regulations on clinical applications of stem cells remains uncertain in the reporting quarter, we managed to continue our growth by focusing on new subscriber recruitment. We are confident that we will achieve our full year subscription target goal through organic growth in our core business. We will also explore potential new business opportunities as well as optimize existing resources to further expand revenue and profit growth."

Summary - Second Quarter and First Half Ended September 30, 2015 and 2016

Three Months Ended September 30,

Six Months Ended September 30,

2015

2016

2015

2016

(in thousands)

RMB

RMB

US$

RMB

RMB

US$

Revenues

171,484

184,140

27,613

336,847

357,092

53,549

Gross Profit

134,244

145,052

21,751

263,034

280,571

42,074

Operating Income3

52,478

54,744

8,209

100,905

106,879

16,027

Interest Expense

26,301

29,801

4,469

52,184

58,634

8,793

Net Income Attributable to the Company's Shareholders

18,723

16,641

2,496

32,274

32,363

4,853

Earnings per Ordinary Share - Basic4 and Diluted (RMB/US$)

0.25

0.22

0.03

0.44

0.44

0.07

Revenue Breakdown (%)

Processing Fees

65.0%

62.5%

64.9%

62.2%

Storage Fees

35.0%

37.5%

35.1%

37.8%

New Subscribers (persons)

16,744

18,037

32,834

34,674

Total Accumulated Subscribers (persons)

474,193

536,8771

474,193

536,8771

Summary - Selected Cash Flow Statement Items

Three Months Ended September 30,

Six Months Ended September 30,

2015

2016

2015

2016

(in thousands)

RMB

RMB

US$

RMB

RMB

US$

Net cash provided by

operating activities

168,506

136,277

20,436

298,632

267,291

40,082

Net cash used in

investing activities

(3,951)

(5,151)

(772)

(9,530)

(84,280)

(12,638)

Net cash used in

financing activities

(60,000)

(60,000)

(8,998)

(60,000)

(60,000)

(8,998)

Second Quarter of Fiscal 2017 Financial Results

REVENUES. Revenues increased by 7.4% to RMB184.1 million ($27.6 million) in the second quarter of fiscal 2017 from RMB171.5 million in the prior year period. The increase in processing fee revenues and recurring storage fee revenues were mainly driven by the increase in new subscribers and the Company's enlarged total subscriber base.